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Krafton’s forthcoming record-breaking listing is just one example of a new economy deal that is propelling primary issuance volumes in South Korea. Just wait until the chaebol join the party with their own spin-offs and EV battery deals.
Asian ECM bankers have a new hive of activity to focus on: South Korea.
The country’s largest ever IPO, worth close to $5 billion potentially, is under way right now for video game developer Krafton.
And that is just part of what could become a record year for Korean listings. So far in 2021, more than 40 issuers have raised around W5.6 trillion ($4.9 billion) in the IPO market – which also happens to be the amount Krafton is hoping to raise in a single deal.
“By the end of this year, the new IPO pipeline could raise more than W30 trillion,” says one banker in Seoul, who adds that the annual record, dating back to 2010, is W10.1 trillion.
That year, the IPO Samsung Life set the current domestic record; another Korean issuer, Coupang, raised $4.6 billion in an IPO on the New York Stock Exchange in March this year.
Why? A large part of the reason is the momentum in Korea’s new economy. Krafton, which is best known for its mobile game PlayerUnknown’s Battlegrounds (PUBG), is one example, but far from the only one.
KakaoBank – the digital bank backed by Korea Investment Holdings, Kakao Corp, KB Kookmin and Tencent; and profiled by Euromoney in 2019 – is one, having received preliminary approval for listing on Thursday.
Bankers close to that deal suggest the digital bank, which has a customer base of 16 million, could achieve a market capitalization similar to leading private sector banks Shinhan or KB Kookmin.
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